The long term goal of our work is to understand vertebrate development at the molecular level. By screening for activities that can induce dorsal structures in Xenopus embryos, we have isolated noggin, an antagonist of Bone Morphogenetic Protein (BMP) activities. In the next five years, we will use noggin and other newly isolated BMP antagonists to understand the role of different bone morphogenetic proteins in development of the embryo. The BMPs constitute the largest subfamily within the TGF-beta superfamily of peptide growth factors. They activate several receptors, and can induce alternate cell fates. In the previous grant period we showed that noggin, a protein with dorsalizing activity and neural inducing activity, acts by binding to BMPs, particularly BMP2 and 4. The binding of noggin prevents BMPs from binding to a receptor. The overall hypothesis to be tested in the next grant period is whether different BMP antagonists are selective in the subset of BMPs they bind, and whether selective inactivation of BMPs instructively induces alternate cell fates.